School-choice option for disabled students upheld by court

School-choice advocates won the first round in a court battle that could ultimately lead to a wider school voucher-type program that allows students to attend private schools at state expense.

A Maricopa County Superior Court judge ruled Wednesday that a scholarship program for disabled students, in which parents get a debit card to pay for education services with state funds, does not violate the Arizona Constitution, as opponents had argued.

The program, known as Arizona Empowerment Scholarship Accounts, was approved last year by the state Legislature. It provides parents of disabled students a debit card with 90 percent of the state per-pupil money that a district or charter school would get to educate their child. The parents can use the money for education expenses such as private-school tuition, textbooks, online learning, tutoring or therapies.

Groups that sued to end the program said they will appeal. But supporters view the ruling as a first step toward creating a wide program that eventually would cover many other, perhaps all, public-school students.

Opponents say the program will harm the public-school system by depriving it of resources.

Some legislators already are trying to expand the scholarships beyond disabled students.

House Bill 2626, expected to be heard in committee on Monday, would expand the scholarships to include, among others, children of parents in the military and students who attended public schools that received a state letter grade of "D" or "F." The grades are based on state standardized-test scores.

Gov. Jan Brewer on Thursday issued a statement applauding the court decision, calling the scholarships a "powerful tool to expand educational opportunities for special-needs students in Arizona."

Critics, including the Arizona School Boards Association, the Arizona Education Association and Arizona Association of School Business Officials, say the law is unconstitutional and fear it will open the door to a larger voucher program in which money is taken from public schools and given to private and religious schools. They sued the Arizona Department of Education last year over the law.

Maricopa County Superior Court Judge Maria del Mar Verdin issued a ruling Wednesday night saying that the plaintiffs failed to prove the program was unconstitutional.

School vouchers have been controversial in Arizona for years. In 2006, Arizona lawmakers created two voucher programs, one for disabled students and another for foster children.

The law was challenged and upheld in Maricopa County Superior Court, then reversed in 2008 by the Arizona Court of Appeals.

In 2009, the Arizona Supreme Court declared the state's school-voucher programs unconstitutional, saying they violated a constitutional ban on appropriating public money for private or religious schools.

In those programs, the state would give a check or other guarantee instrument to parents, who would endorse the payment of state funds to a private school.

School-choice supporters went back to the drawing board. Last year, they passed a law to create the educational savings accounts. With these, state money does not go directly or necessarily to a private school. The program creates a debit-card account for the student, and parents can choose how to spend the money. They can select educational services from one or more entities.

"The exercise of parental choice among educational options makes the programs constitutional," Verdin wrote in her ruling. She cited a 1999 Arizona Supreme Court decision that upheld private-school tax credits because there was no appropriation by the state from the state general fund for an identified purpose or destination.

In that program, taxpayers can take a dollar-for-dollar credit off their state income taxes for amounts they donate to a school-tuition organization, which gives most of the money as private-school scholarships.

The Arizona Empowerment Scholarship Accounts program is small for now. Arizona provided 75 students with debit cards at the beginning of the 2011-12 school year.

The average amount for students approved in the fall for a full year of services was $13,000, said Andrew LeFevre, an Arizona Department of Education spokesman.

The program has since grown to 98 students, and the state is awaiting required paperwork from 56 other applicants.

The Goldwater Institute, a conservative think tank and advocacy group, argued in favor of the scholarships in court.

Clint Bolick, the institute's vice president for litigation, said this week's ruling is "the first step of a long legal journey, but it's great to start off with an opening victory."

Bolick said the court's ruling will be important to legislative efforts to expand the scholarships to include other students, including those who attend low-performing public schools.

"If there was a legal cloud hanging over the program, that would dampen the momentum. We have the wind behind our sails now," he said.

The new House bill would expand the scholarship to cover not only children of parents in the military and students in low-performing schools, but also students who attended a public preschool and, while in preschool, transferred to a private school.

It's unknown how many students could potentially be eligible for the scholarship if these new categories are included.

Bolick favors all students having the option of educational savings accounts but said that is a distant goal. The program first must demonstrate it can succeed with limited numbers of students who are in desperate need of educational alternatives.

Chris Thomas, general counsel for the Arizona School Boards Association, said the group is disappointed and will appeal.

The association argues that scholarship accounts violate the state Constitution because they appropriate public money to aid private schools.

Although the savings accounts allow some choice for parents on where to spend the money, the choices are "highly constrained," making it almost inevitable that the scholarship funds will be used primarily to pay private schools, the association said in court filings.

According to an affidavit provided by the state Department of Education, parents spent a total of $198,764 in scholarship funds in the first quarter of fiscal 2012. About 92 percent went to private schools.

Thomas said the larger issue is that the scholarships allow the state to pull back from its financial commitment to public schools. The state's Constitution requires the state to provide and maintain a uniform public-school system.

"That's always been our concern," he said. "We believe there ought to be great public schools for all, and the Legislature should be singularly charged with making that happen."